Hey people, welcome back to my world. It’s been a very long time since I haven’t written a blog so here I am with another piece of interesting content.
This is a technology that is exciting me all the time and has been thinking about it a lot.
I have written a short brief on this piece of technology.
So, without any further adieu, it’s the NFTs that are driving me crazy and will be talking about it further.
For starters who have no idea about it, let me give a brief introduction so that you understand,
What exactly is NFT?
NFT stands for Non Fungible Tokens.
Before we dive deep and understand what exactly NFTs are let’s understand what is fungible.
In simple terms, Fungible is a replaceable thing.
And so keeping this thing in mind we can conclude by saying that,
Fungible=Replaceable
Whereas, NFTs are a non-replaceable thing.
A thing that holds value and is unique.
This is how our economy works and is structured.
It holds value.
There’s demand and supply for the things that we buy.
So, keeping the thing in mind a sack of rice is fungible and Mona Lisa is Non-Fungible.
Money is a result of a bunch of transactions and it’s fungible cause money fluctuates and it doesn’t hold the same value.
See, the difference as inflation happens the value of money goes down.
This is where the concept of blockchain and cryptocurrency works perfectly.
Blockchain is the base for NFTs where all the transactions that take place are recorded publicly on the internet and this is how NFTs and Cryptocurrencies work in general.
But the question that comes into our minds when we see this technological revolution is,
Is this real?
Well, the truth is it’s all real.
The concept of NFT is real and it’s happening.
There are tens of thousands of NFTs out there.
NFTs comprise various things such as music, photos, tweets, and lots of art that are minted as tokens.
You see this as human psychology let me explain as humans evolve with time there is enough abundance to have such basic needs that meet like food, shelter, warmth, etc.
But what happens next is that it creates value for things that have no inherent value. This value turns into a psychological hype.
As technology shapes up the world and industries, this itself creates curiosity and excitement around a certain thing.
The art industry is changing and is adapting to technological advancement as its shifts its gears from having a physical portrait to having a digital or non-physical way using sophisticated internet technology.
NFTs rely on blockchain technology and they rely on a public ledger that is the heart and soul conceptually, but physically and mechanically it relies on computers doing a bunch of calculations all day and night.
NFTs are stored on a blockchain called Ethereum.
Ethereum consumes around 33 TWh of electricity.
An astonishing fact is that Ethereum Blockchain uses a lot of energy and shows no sign of slowing down.
A lot of energy is used, not just to move people around but it’s used to crunch numbers in a weird computer warehouse so that people can buy a fake token.
Isn’t it weird and cool readers!
Overall, this creates hype for technology and pushes our minds to think.
Also Read:- How Much Energy Does An NFT Use?
How NFTs are being used?
NFTs can be specifically be used with specific physical or digital assets diving deep into the topic they are unique and have data points which means they can’t be falsified or replaced combine the two and you get the most common use for them as a way to prove ownership or the right to use the asset.
A basic idea, but this version sucks, on the other side there’s an intriguing version of using this technology and the common use of it right now is that it’s being sold as digital art as collectible items.
A prime example of it is that of Mike Winkelmann aka Beeple who sold the collection of his work as an NFT every day’s the first 5000 days and created history as his artwork was sold for a whopping $69 million at Christie’s Auction.
Also Read:- Beeple sold an NFT for $69 million
Another example is that of the NBA, which launched their NFT known as NBA Top
Shot comprised of trading cards, sports moments tokenized, and even digital kitties.
These trading cards were created in collaboration with Dapper labs and consist of digital pictures of players and specific moments and even replayable highlights.
One of them was a card of Lebron James that was sold for around $200,000 in minutes. Crazy isn’t it!
Also Read:- People have spent more than $230 million buying and trading digital collectibles of NBA highlights
Companies that are venturing into NFTs
As there’s a hype that is getting created around this technology, and of course why not cause there’s potential in it as it’s the future of art and a wave of opportunities for creative people with that said more companies are keeping an eye on NFTs and are venturing into it.
NFTs started as selling Monkey caps, and art that turned out to be a technological pioneer.
With that said before organizations like NBA started venturing into NFTs by selling their merchandise like trading cards, sports moments tokenized and even digital kitties packaged as NFTs. And it just doesn’t get over yet.
Companies like Adidas and Nike are betting big on NFTs. In December they announced a big movement.
Adidas launched Into the Metaverse, which allowed users to get access to exclusive Adidas originals physical merchandise and promised a ray of future for digital goodies.
It comprised of goodies worth 30,000 tokens each of which was 0.2 Ethereum and was worth around $765 during the initial December sale, the NFTs sold within a minute and clocked around $22 million in sales.
Also Read:- Adidas sold more than $22 million in NFTs, but it hit a few snags along the way
On the other hand, Nike acquired Artifact, a specialized brand in making digital sneakers as a way to grow and penetrate the digital marketplace.
They haven’t launched a project yet but there’s a fact that we should know that a line of digital sneakers sold by Artifact in collaboration with artist Fewocious sold out for $3.1 million in a minute. But the question that pops up is,
Also Read:- Meet FEWOCiOUS, the Teenager Who Crashed Christie's Auction House
Why so many companies are investing in NFTs?
Well, the simple answer is there’s a lot of money to be made.
NFTs have created a new marketplace for artists, art collectors, and traders.
These are the things that are promised by NFTs.
NFTs are not necessarily fads or trends, but it can’t be denied that there’s a healthy dose of FOMO(Fear of missing out).
Of course, it’s a new wave of opportunities for all the art collectors, who love to collect things like playing cards, art, GIFs.
Well, you see that’s the magic of NFTs, throw all these collectibles into scarcity and there it goes becomes an open marketplace.
You see people love collecting stuff and when brands see their products and label them as limited edition it grabs the attention of consumers and creates hype.
And brands understand this and want to leave no stones unturned.
As mentioned before companies such as Adidas, Nike, and NBA have ventured into the space.
It doesn’t stop here companies such as Prada, Mattel, Electronic Arts, Sega, and Square Enix have expressed their interest in NFTs.
But it’s the gaming industry that will benefit from this technology.
So, while playing games you have the option of buying skins, weapons, and armors.
But when it’s packed into an NFT that’s the beauty, you can use the skins, weapons purchased everywhere and can also re-sell them in the marketplace.
You see that’s the advantage of NFTs and the gaming industry wants to cash in.
It can avoid fraud and scams.
Also Read:- NFTs: The next big thing in online gaming
Conclusion:-
So, whether you love it or hate it, the NFTs are here to stay.
Yes, some fewer people are using the technology but slowly and steadily it’ll create a space for all the individuals out there who love to create art illustration and collect art.
So, we have to wait and watch what comes ahead?